Flashcards in Health Insurance Deck (18):
Blanket insurance is a form of group insurance. Often the individual's name is not known because the individuals come and. Unlike other group insurance, the individuals are automatically covered under the blanket policy and do not receive certificates of insurance.
Blue Cross and Blue Shield (The Blues) differences from commercial insurers
-The blues provide the majority of their benefits on a service basis rather than on a reimbursement basis. This means that the insurer pays the provider directly for the medical treatment given the insured, instead of reimbursing the insured.
-The Blues have contractual relationships with the hospitals and doctors. As participating providers, the doctors and hospitals contractually agree to specific costs for the medical services provided to subscribers.
Health Maintenance Organizations (HMOs)
The number of HMOs has grown rapidly in response to increasing health care costs. The purpose of HMOs is to manage health care and its costs through a program of prepaid care that emphasizes prevention and early treatment. In contrast, traditional health insurance is handled on a reimbursement basis, with the insured or provider being reimbursed for all or part of medical expenses actually incurred.
A preferred provider organization is an arrangement under which a selected group of independent hospitals and medical practitioners in a certain area, such as a state, agrees to provide a range of services at a prearranged cost.
Point of service plans are another form of managed care. With POs plans, the insured is given a choice of receiving in-network care or out-of-network care.
Exclusive provider organizations are a type of PPO in which individual members use particular preferred providers instead of choosing among a variety of preferred providers.
Multiple Employer Trusts
METs provide health insurance benefits to small businesses through a series of trusts usually established on the basis of specific industries such as manufacturing, sales and service, real estate, and others.
Multiple Employer Welfare Arrangements
MEWAs are created by small employers who join to provide health insurance benefits for their employees, often on a self-insured basis.
An arrangement that allows very small groups to have some of the benefits of group insurance, especially the lower cost, is called franchise insurance. Franchise insurance works much like group insurance, but it is established differently. There is no master policy. Instead, each member of the group received an individual insurance policy.
Government Health Insurance
Both the federal and state governments offer statutory health insurance programs. On the federal level, Social Security provides disability income benefits and administers the Medicare program. On the state level, all states have workers' compensation laws and Medicaid or some similar form of state-subsidized health care.
Social Security pays four types of benefits:
-Disability income benefits to workers
-Retirement benefits to workers and their dependents
-Survivors benefits to a worker's family
Health Care Reform Act
The following insurance reforms have occurred as a result of the Health Care Reform Act:
-Insurance companies must allow children to stay on their parent's insurance plans until age 26
-Insurance companies can no longer deny children coverage based on a preexisting condition.
-Starting in 2014, insurance companies cannot deny coverage to anyone with preexisting conditions.
-In 2014, everyone must purchase health insurance or face an annual fine.
Facility of Payment
The first optional paragraph is often called the facility of payment clause because it makes claim payment easier under the circumstances described. It stipulates two things:
-If the insured or the beneficiary cannot legally release the company from further liability, as when the insured or beneficiary is a minor or is legally incapacitated, the company may pay the benefits to any relative by blood or marriage who is deemed to be entitled to the money.
-The amount paid to this person cannot exceed $1,000.
If an individual has so much insurance that it is more profitable to see a doctor, enter a hospital, or stay home form work, there might be some temptation to do just that rather than to have a quick recovery. Such an individual is overinsured, which is a situation that insurers try to avoid.
Under the precertification provision, the physician can submit claim information before providing treatment to know in advance whether the procedure is covered under the insured's plan and at what rate it will be paid.
Probationary or Qualification Period
The probationary or qualification period may be found in some disability income policies. It is a period that begins when the policy goes into effect. During this period, no benefits will be paid under the policy. The period is usually 15 or 30 days, or sometimes 60 days under long-term policies. Its main purpose is to relieve the insurance company from paying benefits for preexisting conditions.
The elimination period is the period for which an insured person must be disabled before benefits begin.